Express Scripts CEO Paz to retire next May, leaving legacy of price pushbacks
- Because of a push for lower drug prices by Express Scripts and CVS Health, as well as other payers, drug prices only rose 0.7% in Q2 2015, compared with 4.4% in Q2 2014.
- Express Scripts and CVS have been aggressively negotiating with pharma companies and in the process wining various rebates and discounts.
- Scripts CEO George Paz, who is widely viewed as an activist for lower price companies, is retiring in May. Tim Wentworth is taking over his position.
The biggest wins for payers have been in the area of diabetes and hepatitis C. Paz made headlines in December when Express Scripts announced that it would exclude Gilead's hepatitis C drugs Sovaldi and Harvoni from its list of covered drugs. Instead Express Scripts chose to cover a competitor treatment from AbbVie.
This set off an all-out drug pricing war, leading to a 25% decline in hepatisis C drug prices in the second quarter. The net effect of the activity that this one action has ignited, not only in terms of hepatitis C drugs, but other areas such as the PCSK9 inhibitors, has dramatically shifted the marketing landscape for drugs and a fight to keep prices in check that has flustered the biopharma industry in the U.S.
Paz has been accused by the industry of pursuing tactics that leave patients without access to effective medications and discourage costly R&D investments by biopharma. But there is no denying that he will be leaving his position with a strong legacy that will have a lasting impact on how pharma companies and payers interact.